The Bulletin with UBS 250 years of US innovation part one: the transcontinental railroad
Nov 10, 2025
Kurt Reiman, Head of Fixed Income at UBS CIO Americas, dives into the Transcontinental Railroad's historical significance and its modern parallels, like AI infrastructure. He reveals how the railroad transformed travel and commerce, drastically reducing time and costs. Kurt also discusses standardized timekeeping and the creation of time zones sparked by railroads. He draws lessons from 19th-century capital expenditure cycles, analyzing their risks against today's AI spending, and highlights the importance of studying US innovation history for informed investing.
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Railroad As A Modern-Tech Parallel
- The Transcontinental Railroad was a foundational economic shift comparable to today's AI infrastructure build-out.
- Kurt Reiman highlights parallels in transformative impact across transport, communication, and investment patterns.
Speed And Cost Changed Everything
- The railroad cut cross-country travel from months to a week and reduced costs by about 85% per person.
- Kurt Reiman shows how faster, cheaper transport unlocked resource access, settlement, and new markets across the U.S.
Railroad Created Supporting Systems
- The railroad created ancillary innovations like telegraph integration and standardized time zones.
- These secondary systems multiplied the railroad's value by solving coordination and communication problems nationwide.